IDC reports that 63% of companies are in the process of repatriating applications and data back on-prem from the public cloud. So is the public cloud going bust? Hardly. There is no bust going on, but simply the maturation of a $100 billion dollar industry – a service oriented “cloud-like” approach to IT – that has been on a rocket ship ride. When enterprises operate data infrastructure at enterprise scale, they can actually do better than following the herd that has moved to public cloud providers like Microsoft, Amazon, and Google. They too can operate their own clouds – a combination of on-prem and off-prem public cloud capabilities to set themselves up for better success. Renting is not always the right answer, and when I saw my friends at IDC, they adjusted their number to 80%; that’s right, 80% of companies are considering moving 50% of their apps down from the cloud.

Today’s analogy relates to my brief adventure living in Silicon Valley where it is, for lack of a better description, crazytown.

As a startup there may be no place better than Silicon Valley, given the energy, the technology, the talent, the climate and ease of access to key resources, much like using a public cloud service provider. Even for big companies, the ability to move with the velocity offered by public cloud providers can bring a similar energy and become powerfully addictive.

I lived this personally when in 2014 I joined the Silicon Valley race both physically and metaphorically via my company’s application built in the public cloud. While it began well, we soon moved to pull it on back on-prem, making it a fascinating personal and professional journey for me.

On the Move

It started when my then-employer – a Fortune 200 company – saw my intense travel schedule (50 of 52 weeks a year) and suggested I relo to the heart of Silicon Valley full-time. I took the plunge, sold my home in Colorado, packed up (a fraction) of my house, got on the highway and moved into a rental. It was an older, somewhat run-down house that was 1/4th the size and 7 times the price: differential = 28X. But for me, starting a new chapter, renting was absolutely the right answer.

Meanwhile, back at work, my colleagues and I were knee deep conceiving and coding a new analytics app designed to monitor and optimize a multi-billion-dollar manufacturing process by harnessing millions of data points per day. If successful, this app would not only improve our product through early detection and remediation of defects but also radically improve our yields and profitability. We developed the application in record time by jettisoning our old ways of development and utilizing a big public Cloud Service Provider (CSP) and their new application development architecture based on microservices.

Living in Silicon Valley and running our app in the public cloud was great for a while, and then it wasn’t. The app was fast, operational and successfully validated the promise of analytics by detecting manufacturing trends much earlier and noticeably improving yields. I had a great role (CTO for an emerging business) at a great company and settled in quickly. But living and working in Silicon Valley can come at a high cost both financially and personally, replete with insane commutes, long hours, and great uncertainty. When you haven’t seen the other side, you may not know the grass can be greener elsewhere. And we have a lot of grass in Colorado. The same can be true with the public cloud. What often starts as a panacea for all that ails traditional IT can be a false cure.

For What It’s Worth

After a while one of two things happen – you overlook the shortcomings of your environment and accept it, or you gain perspective and question whether the cost is worth it going forward. Wait… am I talking about living in Silicon Valley or running your applications in the public cloud? Yes. My journey on both fronts helped me see the benefits and the downsides – the cost, the lifestyle, the performance – and helped me better quantify it all.

My CIO, a keen eye, underwrote an independent assessment of the costs and benefits of moving the valuable app, back on-prem versus keeping it at the public CSP. The app had grown to consume lots of heavyweight compute instances and accessed and analyzed terabytes of information on a daily basis. Our bills had skyrocketed to hundreds of thousands of US dollars per quarter, while the projected cost of hosting our application across distributed co-location facilities was just one third of that. As important, because the application was now relatively stable, the increased velocity we experienced in the public cloud was no longer essential and our teams had grown. Development velocity had been realized, and the savings of moving back on-prem were deemed significant. Just because our app was born in the cloud did not mean it was predestined to live there forever.

Packing Tips for the Hybrid Cloud

First off, repatriating an app or data from the public cloud does not relegate IT back to the old ways of operating. If it did, digital transformation would just be called digital expiration. In fact, it’s quite the opposite. Cloud is more of a way of operating than a destination. Once organizations have experienced that way of operating, they don’t go back to the old ways or legacy systems they left behind. My friends at Enterprise Strategy Group, a leading IT analyst firm, have said that fully one-third of organizations move to a software-defined infrastructure future when they come back, replete with advanced automation and machine learning to keep the systems humming. Large enterprises also know that the long term answer is both on-prem and off-prem (now known as hybrid cloud and increasingly called multi-cloud in effort to ensure that new apps be ready for moves in the future). The large CSPs see the same thing and have each announced their intention to enable a hybrid future. The key takeaway is that a DevOps based approach to application development and the use of microservices architecture have changed the game.

To finish my story, we successfully moved the analytics application back to a private cloud environment, achieving the projected savings and increasing performance 200%. By selecting the right infrastructure, we forever transformed the company’s approach to IT.

As for me, after helping them bulk-up with numerous acquisitions, the company moved from feast to famine and I moved on. Analyzing the costs and benefits of staying on led me to a different choice. I moved back “on-prem” to Colorado as my primary residence, but took a page out of the “hybrid cloud” playbook by settling down in a location that facilitates easy travel to and from Silicon Valley and consistent accommodations when I visit (thank you AirBNB).

Cloud Strategy Checklist

In moving toward the cloud strategy that serves you best I recommend that you:

  • Focus on Velocity: Service oriented approaches (DevOps / Microservices) are powerful in enabling velocity in application development while abstracting the “how” from those consuming the service.
  • Have a Cloud Mindset: At scale, the value of these cloud services approaches can be realized using public, private or hybrid clouds.
  • Where You Start May Not be Where You Finish: Public clouds are a viable way of developing applications due to development velocity. You may want to move between public and private over time. And, know your apps – some are a good fit for public cloud, some for private cloud and some may not be destined for any cloud at all.
  • Avoid Lock-In: Applications should be architected to avoid being locked in to a given vendor, or your own, microservices. An explicit application goal should be enabling agility between public, private and hybrid clouds.
  • Watch your Bottom Line: Don’t assume the cost of public cloud as a cost of doing business. Periodically review the cost of deployment between public and private implementations paying particular attention to applications with high storage access or compute intensity and be mindful of changing regulatory (FASB Leasing Statement #13) climate regarding the treatment of public cloud costs.
  • Build with the End in Mind: Harness new software-defined cloud-like infrastructure (like Datera) for on-prem deployments that enables the same flexibility and velocity of the public cloud and provide the capabilities to achieve a portable, hybrid-cloud future.

My final move was to Datera, where we offer Enterprise Software Defined Storage, for private, hybrid and public cloud deployments that delivers a policy driven, high performance and technology agile storage infrastructure for your mission critical application. If you are in that 80% contemplating your cloud future – in the public cloud or on-prem – we’re here to help.

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